Friday, June 2, 2017

What is the Fairest Way to Distribute Transportation Funding in a Diverse Region?

When it comes to divvying up transportation funding, everyone has their own idea of what constitutes a “fair” formula. Last week, the Metro Board of Directors had an extended discussion about the formula for Measure M Local Return, which is funding provided directly to cities for local transportation needs, such as street and sidewalk repair, local transit services, bike lanes, and pedestrian safety projects. Currently, all three sales tax measures in Los Angeles County (Proposition A, Proposition C, and Measure R) distribute Local Return by population. The Measure M Ordinance passed by voters last November includes a similar population-based formula. However, there is an effort underway to revisit this policy based on the notion that the current formula does not provide sufficient funding to some cities.

Of course, with a limited amount of funding in play, any change in the formula would create winners and losers. Cities with large job centers are advocating for the use of a “daytime” population formula that takes into account employees in addition to residents. Others are asking for a formula based on sales tax receipts or roadway miles. Small jurisdictions would like a minimum allocation regardless of population. Not all of these proposals would comply with the Measure M Ordinance. A complete matrix of all the different formulas under consideration was attached to agenda item #30. (See the summary here, as well as a breakdown for every jurisdiction under each scenario.)

For us, this discussion only underscores the need for a shared definition of equity based on common values. We appreciate Supervisor Janice Hahn and Long Beach Mayor Robert Garcia’s willingness to challenge the status quo, but without a common frame of reference, every interest is pursuing what they see as fair…to them. Absent from the discussion was a clear objective for who the new policy is trying to benefit and what problem the additional resources are intended to solve.

If the goal is to ensure a basic level of funding for small jurisdictions, then Measure M should not be looked at in a vacuum. Cities also receive funding from Propositions A & C, Measure R, the gas tax (which was just increased thanks to SB 1), TDA, and other sources. When all these funding sources are included, only the industrial tax havens of Vernon and Industry receive less than $100,000 per year. Even the smallest residential suburbs, like Bradbury and Rolling Hills, get $125,000 each per year for local transportation needs. None of these jurisdictions can be considered poor. For larger, more expensive projects, these cities can leverage Local Return funding with Measure M’s subregional programs and other grant sources.

If the goal is to address extra demand on the transportation system generated by employment centers, then jurisdictions should be incentivized to address their self-inflicted jobs-housing imbalances rather than rewarded for exacerbating it. An employment-based formula would subsidize cities that haven’t built enough housing for their workers in the midst of a severe regional housing shortage by taking resources away from those that have.

If the goal is to provide additional funding to communities with fewer resources, then jurisdictions should be identified based on demographics rather than arbitrary fiscal thresholds. The lowest-income communities are concentrated in unincorporated Los Angeles County, the City of Los Angeles, and population-dense small jurisdictions like Cudahy and Maywood. Many of these communities have experienced high pollution burdens from nearby industry and disinvestment based on racial discrimination. None of the proposed alternative formulas would benefit these communities.

Without a clear definition, fairness becomes a subjective argument. It shouldn’t be. We believe that there needs to be a rational basis to depart from the population-based formula that was written into the plain text of the ordinance. As we noted in our analysis of the draft Measure M Guidelines last month, the list of cities that would benefit the most under any of the scenarios being discussed are either small, exclusive suburbs or industrial cities that have intentionally kept their populations low in order to evade political accountability for environmental justice issues. The donor jurisdictions under each of the scenarios are denser and more urban, including many low-income communities with transportation needs of their own. Adjusting the potential formulas changes the list of which cities benefit and which ones are impacted, but it doesn’t change the fundamental calculation that any move away from a population-based formula transfers resources from low-income communities to higher-income ones.

We support efforts to ensure that the communities that are most in need of additional resources can benefit from targeted transportation investments. Unfortunately, this Local Return discussion doesn’t move us closer to that goal. We hope that instead our region can have a broader discussion of transportation equity that clearly defines our goals, informs our investment strategies, and measures outcomes in our communities.

What's next for Measure M Implementation? Find out June 6th at the Metro PAC

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